Why former Tata Group executives are NOT in favour of Tata Sons' listing

Following the passing of Ratan Tata in October 2024, the internal conflict in the conglomerate has been a relentless topic of discussion. There are many dimensions to this, with the most obvious being the battle within Tata Trusts, the entity that owns two-thirds of Tata Sons, the group’s holding company.

All has not been well with the trustees, with reappointments to key trusts being one issue and disagreements on others, with the potential listing of Tata Sons being right on top.

For a few weeks now, former top executives of the Tata Group have expressed their views in the media on some of these issues.  N A Soonawala, ex-Tata Sons’ Vice-Chairman, in a newspaper column, said a potential listing could fundamentally alter the group’s structure and dilute the social purpose. To him, the ownership model has allowed it to support struggling companies and pursue long-term interests without the pressure of public markets.

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In September 2022, the Reserve Bank of India (RBI) designated Tata Sons an “upper layer” non-banking financial company (NBFC), placing it among the most systemically significant such institutions in the country. Under RBI’s scale-based framework, entities in this category must list within three years of such a categorisation, unless granted an exemption or deregistration. That compliance deadline ended on September 30, 2025.

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Meanwhile, the Tata Group has sought deregistration, maintaining that Tata Sons is not engaged in lending and, therefore, should not be regulated as an NBFC. Within Tata Trusts, its Chairman, Noel Tata is not in favour of a listing, even as other trustees, Venu Srinivasan (TVS Motor Company’s Chairman Emeritus) and ex-defence Secretary, Vijay Singh have backed it.   

Meanwhile, Ishaat Hussain and R Gopalakrishnan, both former Tata Sons’ directors, in a column, said there have not been too many cases internationally where companies have been mandated to go public. Their argument is that boards take such decisions and the exceptions are banks that use a lot of public money. According to them, that is not applicable to Tata Sons since it does not access public funds and can remain unlisted.

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There are multiple issues at play here that include the renewal of N Chandrasekaran’s term as Tata Sons’ Chairman and concerns around the loss-making ventures in the group. In a recent column, both Gopalakrishnan and Soonawala outlined that the biggest lesson for the group is that the institution is bigger than the individuals.